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2021 (4) TMI 509 - AAR - GSTClassification of supply - rate of GST - composite supply of services or not - vehicle owner, the driver and the associate partner together - pick-up charges paid to the Owner/ Driver - service charges collected from the passengers - Associate Partner renders services to the Passengers and to the Drivers/ Vehicle Owners directly - amount received from the Owners / Drivers towards bidding - Goodwill Bonus being paid by Passenger to the Driver for good service - charges for cancelling the trip - charges for insurance - Principal supplier/ Applicant collects GST, along with fare from Passengers and remits that amount. Whether the various supplies (of the applicant, the vehicle owner, the driver and the associate partner together) qualify as Composite supply? - HELD THAT:- The conditions for a supply to be considered as a Composite Supply are (i) the supplier (taxable person) should supply two or more taxable supplies to a recipient, (ii) the said supplies should be naturally bundled and (iii) the supplies should be supplied in conjunction with each other, in the ordinary course of business, one of which is a principal supply. In the instant case, we observe that the applicant is providing two taxable services, i.e. providing an online platform and insurance coverage to the passenger. It is an admitted fact that the insurance coverage to the passenger is optional and also online platform service is neither related to nor ancillary to insurance service. Thus these two supplies are not naturally bundled. Further the said supplies are not in conjunction with each other, in the ordinary course of business. Therefore, we conclude that the activities performed by the applicant do not amount to a composite supply. Whether the pick-up charges paid to the owner / driver fall under GST rate of 5%? - HELD THAT:- The driver need to pick up the passenger before starting of the radio taxi service and hence the pick-up service is incidental to the main service of transportation of passengers by the drivers. The applicant has been made liable for paying the tax in respect of the said service through the e-commerce platform, as if the applicant is the supplier of such service, in terms of Section 9 (5) of the CGST Act, 2017. Further, Notification No. 17/2017-Central Tax (Rate) dated 28.06.2017 stipulates that an electronic commerce operator is supposed to pay GST for services by way of transportation of passengers by a radio taxi - the pick-up charges and basic fare are part of the service of transportation of passengers by a radio taxi and hence the applicant is liable to pay GST @ 5%, on the pick-up charges also. Whether any supply of service exists between the applicant /aggregator and the Associate partner, & if yes, what is the rate at which GST has to be collected and remitted? - HELD THAT:- In the instant case the associate partner is providing services to the applicant. The impugned services of associate partner are covered by clause (ii) of Sr. No. 23 of Notification No. 11/2017- Central Tax (Rate) dated 28.06.2017 and hence GST @ 18 % has to be paid by associate partners in case the associate partner is registered under GST. In the case where the associate partners are not registered under GST due to threshold limit, no GST is leviable on the amount remitted to the associate partner. Whether the amount received from drivers/owners towards bidding gets covered in the 5 % GST or should it be separately charged at 18%? - HELD THAT:- The amount received as a bidding charge is outside the fold of basic fare i.e. the relevant service is not related to the service provided by the owner/driver to the passenger/customer through the e-commerce operator. We therefore find that 5% GST rate is not applicable - the same is covered by clause (ii) of Sr. No. 23 of Notification No. 11/2017- Central Tax (Rate) dated 28.06.2017, at the rate of 18 %. Goodwill bonus being paid by passenger to the driver and on which the applicant collects the service charges - Whether the service charges so collected attract GST and if so at what rate? - HELD THAT:- Goodwill bonus is a voluntary payment made by passengers when they are happy with the service provided by the drivers. It is outside the fold of basic fare charged from the passengers for the trip. The applicant collects service charge on the goodwill amount. We find that the service charge collected for facilitating the payment of goodwill amount to drivers is consideration in terms of Section 2 (31) of CGST Act, 2017 and hence is liable for GST at 18% under heading 9985 vide clause (ii) of Sr. No. 23 of Notification No. 11/2017- Central Tax (Rate) dated 28.06.2017. Whether the charges for cancelling the trip for any reason attract GST liability? - HELD THAT:- The applicant has submitted that cancellation charges collected from the passengers may be shared with the owners or drivers. The activity of tolerating the cancellation by the applicant for a consideration is supply of service by virtue of clause (e) of para 5 of Schedule II of CGST Act, 2017 and attracts GST at 18 %. Whether the charges for insurance come under composite supply? - HELD THAT:- It is observed from the terms and conditions that passengers are covered under appropriate insurance against accidents, that the passenger has to opt and give his/her specific consent for the insurance coverage, at the time of booking the ride/trip - thus, its optional on the part of passenger to avail insurance on the trip and the same will not fall under composite supply. If the principal supplier / applicant collects GST, say at 5% along with fare from passengers (as mentioned in the Table submitted by the applicant), does it amount compliance of the GST Rules? - HELD THAT:- 5% GST is only applicable on basic fare. The applicant has to pay GST at 18% on other incomes.
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